The settlement means Google will escape fines of up to $5bn (£3.2bn) and enforcement that could limit its activities in the region.
Under its five-year pledge, Google has agreed to offer three links to rival services that will appear next to its own specialised search results – such as Google Shopping or Flights. Previously Google had bumped down competitors’ search results and a previous offer to display them in a separate shaded box was rejected by the Commission.
Rivals such as Microsoft will still need to pay Google each time their results are shown in this way via a bidding process that will be approved by an independent monitor.
EU Competition Commissioner Joaquin Almunia said in a statement that the proposals provide users with “real choice between competing services presented in a comparable way; it is then up to them to choose the best alternative”.
Almunia says the proposals will not need a “market test” before being rolled out and accepted.
Google senior vice president and general counsel Kent Walker, says: “We will be making significant changes to the way Google operates in Europe. We have been working with the European Commission to address issues they raised and look forward to resolving this matter.”
The EU investigation was triggered by complaints by 17 rivals including Microsoft and Nokia who claimed Google was giving “preferential treatment” to its own services over those from competitors.
David Wood, legal consul for Icomp – a trade body representing online companies affected by Google’s practices – told the New York Times: We do not believe Google has any intention of holding themselves to account on these proposals.”